Rice, the main staple, is now the costliest ever in Bangladesh when July prices of the same were two-year low globally.
The country also reaped bumper harvests during the immediate past Boro and Aman seasons.
Hoarding, conservative imports, and inefficient market operations by the government have been the key reasons behind giving rise to an unusual situation in the domestic rice market, said value chain experts.
The UN's Food and Agriculture Organisation (FAO)'s All Rice Price Index hit a two-year low of 101.2 points in July 2021, down 6.6 per cent from its June level and 8.2 per cent below its value a year earlier.
In a contrasting development, the rice prices increased to a one-year high in the first week of July in Bangladesh, according to the Trading Corporation of Bangladesh (TCB). The uptrend is still on.
The state-run trading agency records showed that rice prices were 12-14 per cent higher in July than that of last year.
The retail prices of coarse rice ranged between Tk 50-52 per kg in Dhaka markets on Saturday while medium variety between Tk 56-60 and finer variety between Tk 65-78, according to traders.
The FAO's report, published in August, said that except Japonica species, all kinds of rice indices showed a downtrend in July.
It said prices of Indica species, largely consumed in South Asia and other Asian regions, went 7.6 per cent down in July than that of June this year.
Indian parboiled rice (5.0 per cent broken) and other exportable rice varieties of the country recorded at US $359.2 to $385 a tonne in July.
Pakistani, Vietnamese and Thai Indica varieties, similar to that of rice varieties consumed by the Bangladeshis, were traded at $376-$438 a tonne in July.
In contrast, the prices of all varieties of rice increased by Tk 1.0-1.5 a kg at the mill-gates during the last few days in major three milling hubs of Kushtia, Pabna and Naogaon, according to sources.
According to the Bangladesh Auto Major Husking Mill Owners Association, coarse rice was selling at Tk 40-42, medium Tk 48.5-50 and common finer at Tk 53-57 a kg in the mill gates now.
Secretary of Ishuardi Rice Mill Owners Association S K Aziz told the FE that the prices of rice increased slightly in a week. He found the increase a normal trend.
He said the paddy prices have been much higher this year. This has resulted in the increase in rice prices.
Hybrid paddy was selling at Tk 980-1000 a maund, medium Brridhan 28 at Tk 1175-1200 and finer Zira or Minikit at Tk 1250-1300 a maund (40 kg).
Prof Abdul Hamid, chairman of Bangladesh Agrarian Research Foundation (ARF), said the rice is pricier in Bangladesh due to considerably higher production costs, big players' influence on market, import hurdles and inadequate market intervention by the government.
He said that many big farmers and seasonal traders have been hoarding a large volume of paddy every season since the pandemic began last year. Such hoarding is also causing pressure on the market, he said.
He stressed the need for conducting strict monitoring both at the processing and wholesale levels in the cities and villages to ensure abundant supply of the item.
He said as the government has a healthy food stock now, it should expand open market sale of rice across the country to help poor people get rice at affordable prices.
Farmers' incentives should be increased substantially to keep them in farming as well as to boost food crop production, he added.
Consumers Association of Bangladesh vice president S M Nazer Hossain said the current rice price is beyond reach of the millions during this lockdown period.
He said the rice prices increased by more than 12 per cent in a year although the overall inflation was low.
He said restrictions on the private sector import should be removed immediately so that the poor people can afford to buy rice.
The government expects an all-time high production of 20.5 million tonnes of Boro rice during the last fiscal.
The government has so far been able to purchase 1.25 million tonnes of boro rice from the domestic market against the target of 1.9 million tonnes, according to the Directorate General of Food.
Both the public and the private sectors combined imported 1.5 million tonnes of rice in between January and July this year which was three-year high.
The public warehouses now have 1.56 million tonnes of food, which is one-year high, including 1.4 million tonnes of rice and paddy.
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